UC and overpayment of SSP - treatment of “income”

I’m not holding out much hope but here goes…

Claimant was working until November 2017 and her contract was terminated following a period of sick leave.  She claimed UC in December 2017 and her UC in February was zero standard allowance as they said that she had received money from her employer.  We checked her bank statements and she hadn’t been paid so called HMRC who confirmed that a payment was made by her employer.  We called them and the “payment” was used to reduce an overpayment that she had (it was underpaid SSP).

I know that SSP counts as earnings etc and for UC it was the date that the payment was received (UC Reg 54 etc)but could you argue that as she never received it it should be disregarded?  Her employer has written an explanation stating that they used it in full to reduce what she owes…

Thanks!